The Albanese government knocked back a bid by Qatar to operate an additional 21 services out of Australia per week after lobbying from the national carrier Qantas.
Virgin Australia’s boss Jayne Hrdlicka said allowing more Qatar flights in and out of the country could bring down airfares by 40 per cent, as well as providing a huge boost to the tourism industry.
She hit back at comments from Assistant Treasurer Stephen Jones who suggested bringing prices of flights down would make it ‘unsustainable’ for Qantas.
‘We can drive prices down but if we drive them down to a level where it’s actually unsustainable to run an airline, instead of having two carriers we will design our markets in a way which will make it unsustainable for the existing Australian-based carrier,’ Mr Jones said on Monday morning.
Virgin boss Jayne Hrdlicka said allowing more Qatar flights in and out of the country could bring down airfares by 40 per cent and would be a huge boost to the tourism industry. The government blocked Qatar’s bid for more services
‘Having a national airline that occasionally post a profit is not a bad news story. It’s actually a good news story.’
Ms Hrdlicka said the comments were ‘disappointing’ and said she didn’t believe the government had the ‘full facts’ about the benefits of having more flight services available.
‘It’s a disappointing statement, and I’m sure that every CEO in the country was disappointed to hear that there’s one company in the country that should be protected, and profits should be protected,’ she told ABC’s RN Breakfast on Tuesday.
She stressed Qantas was not government-owned and had shut down during the Covid pandemic.
‘I don’t think the government had the full facts, I’m surprised to hear the basis for the decision would be to protect Qantas profits, that’s super surprising and very disappointing if that’s the case,’ she said.
The Virgin CEO also shot down claims from Qantas boss Alan Joyce who said allowing more flights into Australia could distort the international market.
‘It’s a bit of a nonsense to say it’s a market distortion,’ she said.
‘Qantas and Emirates together as partners have roughly 45 per cent share to Europe over the Middle East.
‘And Qatar today has about 23 per cent … there’s no market distortion that can be argued as a reason not to add Qatar’s flights.’
Ms Hrdlicka claims she has repeatedly reached out to the government to discuss the Qatar matter with them, but is yet to hear back.
She said Qantas, who posted a $2.5billion profit for the past financial year, was the only party objecting to the Qatar bid.
‘I’d encourage the government to step back and say let’s get all the facts on the table and understand what’s actually in the national interest,’ she continued.
‘There’s over $500million in economic interest at stake here in the tourism industry, that’s a lot of jobs and reinforcement for vital parts of the economy.
‘You need to have a very good reason to walk past that.’
Qantas boss Alan Joyce had lobbied the government, saying blocking Qatar from having operating more services in and out of Australia was in the national interest
Airfares are 50 per cent higher now than they were before the pandemic, Ms Hrdlicka said, with two thirds of seats flying in and out having since returned.
‘If we get that one third back, airfares will be as low as they could be,’ she said.
‘It’s really important we take advantage of every opportunity to get more seats in and out of Australia.’
It comes after Mr Joyce admitted the airline lobbied the government, saying it amounted to protecting Australia’s national interest.
Mr Albanese’s relationship with Mr Joyce has come under close public scrutiny after it was revealed the Prime Minister’s son Nathan had been granted access to the exclusive Chairman’s Lounge.
The opposition has also hit out at a lack of transparency underpinning a decision to ban Qatar from flying more domestic routes, saying it is not the job of the government to protect Qantas’ profits.
The Albanese government knocked back a bid by Qatar to operate an additional 21 services out of Australia per week after lobbying from the national carrier Qantas
Liberal frontbencher Simon Birmingham said it was not clear cut why the government denied Qatar the extra routes.
‘We’ve had reasons thrown up in terms of behaviour of officials in Qatar, we’ve had reasons about Qantas’ profitability, we’ve had reasons about questions around purchasing of new aircraft,’ he told Sky News.
‘It’s not the government’s job to automatically make Qantas profitable.
‘Of course, we want to see the national carrier be profitable and for it not to need government intervention or bailing out but there’s no transparency around the basis upon which the government formed this decision.’
Opposition finance spokeswoman Jane Hume said it was ‘quite confronting’ that Qantas heavily lobbied the Albanese government to deny Qatar the extra flights, which would have provided an extra one million seats a year.
‘Increasing the competition would bring down the cost of airfares for Australians and the Albanese government has denied that,’ she told Seven’s Sunrise program.
‘They actually went against departmental advice after lobbying from Qantas, now, that in itself is a great concern because it means that the government is actually artificially keeping airfares high.’
Mr Joyce had claimed Qatar’s additional services wouldn’t bring airfares down.
He said the airline could add capacity through flying bigger aircraft to cities like Adelaide and Darwin.
‘There is nothing stopping them from adding capacity to those locations,’ he said while appearing before a Senate committee on the cost of living crisis on Monday.
Ms Hrdlicka ran Qantas budget carrier Jetstar from 2012 to 2017, and answered to Mr Joyce.